January 24, 2007

The Lizards React to the State of the Union

I have to be honest: I'm often more affected in the long term by speeches delivered low-key than by ringing, declaiming barn-winders by William Jennings Bryan wannabes; I will not crucify Mankind upon a cross of rhetoric. So to cut to the climax before we've even left the introduction, I absolutely loved the State of the Union speech last night.

The mix between domestic affairs and foreign relations was a little too skewed towards the former; but the domestic agenda that President Bush raised is by and large sound:

Keeping the economy rolling without tax increases;

Holding the line on spending. The Democrats have already killed the Gregg amendment, which would have allowed the president to send unvoted earmarks back to Congress to reconsider -- in the full light of day; so if this is to happen, it will have to be through presidential vetoes (I'm pleased that the GOP found enough of a spine to filibuster the minimum-wage increase until there are proper safeguards for small businesses);

Earmark reform in general (the Democratic House reluctantly supports it; the Democratic Senate recoils as from a leper);

Reform of "entitlement" programs: Medicare, Medicaid, and of course Social Security; as Lawrence Kudlow explained: "The real problem with Social Security is not bankruptcy. It's the dreadful investment return (barely 1 percent) that future retirees have to look forward to."

Expanding "No Child Left Behind" -- eh, it's probably a minor improvement. Nobody is championing my personal solution: the real problem with American public education is not lack of money, oversized classes, the specific curriculum, or the particular mix of administration to teachers: the real problem with American public eduction is that most teachers are plain lousy.

The solution is to fire the incompetents; all else is dicta. At a minimum, teachers who cannot pass subject-matter tests at least at college level (for teaching primary school) or graduate level (for teaching secondary school) should be sent packing: if you cannot pass a mathematics test equivalent to a GRE, you have no business teaching high-school math.

A tax deduction for health-care insurance: I never met a tax cut I didn't like; but this is "DOA" in the Democratic Congress, or at least "wounded on arrival," as Ron Pollack of the ultra-liberal Families USA put it (link is subscriber only, but you can find the same sound-bite elsewhere);

Comprehensive immigration reform -- you know where we stand on this one!

More nuclear power plants, coal, solar, wind (yes); more ethanol (yeesh); and although Bush referred to us being "on the verge of technological breakthroughs that will enable us to live our lives less dependent on oil," I wanted to hear more about advanced reactor designs -- and especially high-temperature ceramic engines;

A straight up-or-down vote in the Senate on all federal judges appointed by any president: this is so no-brainer that even Chuck Hagel (R-NE, 96%) probably supports it!

But where Bush really shone was in his ringing defense of the war in Iraq as part of the larger war on global jihadism. From the recitation of several huge, ghastly terrorist attacks that we thwarted after 9/11; to the chilling quotations from the jihadis themselves about their murder, mayhem, and bloodlusting plans for our future; to the brief explication of the split among the jihadis between Sunni and Shia... all of it was grand and necessary.

And it seems to have had some effect. John Hinderaker at Power Line buried this great news at the bottom of a post about Sen. Lurch opting out of the presidential race; but the news deserves its own post: a CNN poll found significant movement towards the president among those who viewed the speech (laugh at CNN's lefty spin):

Forty-one percent of 370 adults who watched the speech said they had a "very positive" reaction to it. Another 37 percent said their response was "somewhat positive." In 2006, however, the "very positive" number was 48 percent; in 2005, it was 60 percent....

Sixty-seven percent of speech watchers said they believe Bush's policies will move the country in the right direction, the lowest total of his presidency. In 2006, the number was 68 percent; in 2005, it was 77 percent.

Meanwhile, 53 percent said they believe the speech will lead to more cooperation between Bush and the Democrats who control Congress. Forty-three percent said it will lead to more disagreements.

Among the speech viewers, 51 percent said they were very or somewhat confident that the United States will achieve its goals in Iraq. After Bush's 2004 speech, the number was 71 percent.

But before Bush's 2007 speech -- which is the proper comparison -- the number was 25%. Which means that before Bush's January 11th speech, 25% - 29% of people thought our strategic change of course in Iraq would help; but now, after that speech and after the State of the Union speech (among those who actually listened to it), the percent that believed the new strategy would help more than doubled.

Note, these are two separate pools of respondents: most of those surveyed on January 11th had not watched the president's speech -- and it was heavily skewed towards Democrats. The CNN poll had a much smaller partisan advantage, and those polled were all interested enough to have troubled to watch the SOTU. The wording of the questions was also marginally different. But those differences do not account for all of that rise, in my opinion.

I think this speech did change people's minds. Some people, at least; perhaps only Republicans and some portion of Independents... but that's a start. The reason Bush's approval rating is so incredibly low (especially with such a good economy) is that many of his core supporters have deserted him -- mostly on the war.

The word "dire" is being flung about by everybody now (they got it from the Baker-Hamilton ISG report); even Lt. Gen. David Petraeus used it during his testimony a couple of days ago. But for God's sake, "dire" describes Dunkirk, not Baghdad. "Dire" describes the retreat down the "frozen Cho-sen" in 1950. "Dire" is the word you'd use for the beleagured 20th Maine Volunteers, commanded by Col. Joshua Lawrence Chamberlain, on Little Round Top, at the Battle of Gettysburg in 1863...

And it's important to note -- three fights far more dire than what we've got in Iraq... yet we won every one of those wars.

Iraq is neither so dire nor so bloody, by orders of magnitude, as World War II, the Korean War, or the Civil War. But those were fought by a different class of American, I reckon... a class that had the courage of their convictions, and just plain old courage. Don't we want to take them as our model, rather than Murtha, Pelosi, Hagel, and their ilk?

I believe this speech by Bush has called us all to courage by the simple act of patience: remember that we're Americans, he urges, and give our change in strategy some time to work.

I think both the speech and the underlying strategic change have already started to work; the panic has abated somewhat, and we're killing and capturing both Sunni terrorists and Shiite death squad members at a joyful clip. Fear is the mind-killer: when the shroud of fear lifts, and people can start to look with dispassionate eyes, they will see that we're really not doing anywhere near as badly as the knee-knockers pretend.

Are we doing as well as we would like? Hell no; but that always happens in the midst of a war. The proper reaction is to figure out what we're doing wrong, fix it, and move forward towards victory.

That is what President Bush, David Petraeus, and the rest of the American military command are doing. What about Congress? As a number of us are asking, what conceivable purpose does it serve, when the strategy is already decided and in motion, to pass a resolution expressing Congress's firm belief that we're going to fail and go down to horrible defeat?

As Sachi put it, these resolutions may be non-binding, but they are not non-damaging.

We only have one question for the nitwits dithering about whether to sign aboard either "surrender swift" or "surrender slow" -- the decision has been made; the die is cast. We're rolling; are you coming?

Hatched by Dafydd on this day, January 24, 2007, at the time of 5:47 PM

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I agree with you fully on the teaching thing. The problem with teaching isn't funding, it's the standards that instructors and students are held to.

If the folks at NASA could field mammoth teams of scientists and engineers who had to design Saturn V while using slide rules, and without the benefit of New Math, Snazzy Applied-Calculus Texbooks full of glossy pictures, and Using Calculation Tools To Substitute for Math Thinking, then I think modern schools can teach students with the current funding--as long as the teachers know their stuff, and the students know that they have to Learn the Material, not simply Pass The Test With A Calculator's Help.

Iraq is neither so dire nor so bloody, by orders of magnitude, as World War II, the Korean War, or the Civil War. But those were fought by a different class of American, I reckon...

It's still being fought, at least physically, by top-tier Americans. It's the politicians that have lost their sense of pride.

The above hissed in response by: toughluck at January 24, 2007 10:11 PM

The following hissed in response by: scrapiron

The dhimmi press has been going full speed to drive the favorable numbers down. I wish someone would figure out how to tell how many things they have told the American people the president said that he did not say. I used to watch every speach by any president and they watch the media begin lying within minutes. This time they were telling lies based on their advance copy. And we're supposed to believe anything we see in the antique MSM outlets. I think not.

The above hissed in response by: scrapiron at January 24, 2007 10:26 PM

The following hissed in response by: charlotte

the real problem with American public eduction is that most teachers are plain lousy. The solution is to fire the incompetents

Yep, we should fire poor to lackluster teachers, principals, administrators, superintendents and parents (don’t forget some of them!), although most of the inequities wrt to education seem to well less from funding and personnel problems than from subcultural values and the education establishment’s politics. Inner city schoolkids are hampered by broken families, raised by peers, and told that excelling is white and uncool. The few kids who are academically inclined and motivated to do well are propagandized by a system (at least in my city) that only offers liberal, socio-ethnic manipulating curricula. These schools function as little more than daycare centers and nominal, not good mind you, socialization centers. For both inner city and the burbs, would love to see public schools get back to teaching positive civics and classic western civ (plus oriental and third world) history, logic, sciences, art, etc. without the PC moralizing/ demoralization.

I, too, liked Bush’s speech- his proposals and the tone he struck. His constructive conciliation while sticking to core principles was probably completely wasted on those on the other side of the aisle and a little on those of his own, though. Looks as if Bush’s main job as President will be to see through our ME project, some national security objectives and geopolitical realignments, while upholding confidence in our economy. The Repubs seem too split domestically for any headway against the Dems to happen.

The above hissed in response by: charlotte at January 25, 2007 8:39 AM

The following hissed in response by: Dick E

Dafydd-

I agree with the comments above re No Child Left Behind. Scott Johnson’s recent Powerline post on vouchers talks about a step in the right direction.

With respect to Social Security, I beg to differ a bit with the learned Mr. Kudlow. I don’t think most people look at Social Security benefits as a return of their contributions plus interest – although of course they could, and some, like Mr. Kudlow, do.

Personal savings accounts would of course allow participants to obtain substantially greater returns. And I, for one, wish I had such a SS account. The question is, how can we transition from the current pay as you go system to PSA’s?

As you know (I think we’ve discussed it here before) the SS “Trust Fund” consists entirely of IOU’s (Treasury securities) representing SS taxes collected and then spent on non-SS government programs. Every kopeck of SS tax collected is immediately spent on benefits, and whatever is left over is loaned to the General Treasury.

OK, so we let people start having PSA’s. If it’s all incremental money – i.e. participants continue to pay the same SS tax, plus they set aside an additional amount for their PSA’s – the financial side of it works. Everyone receiving benefits will continue to do so, and the Feds will still get that extra cash from the excess taxes paid. (Over time, the non-PSA portion of SS contributions would decrease, but it will take a long time to eliminate it.) The question then is, is participation voluntary or mandatory? If voluntary, we just created another program that only “the rich” will participate in. If mandatory, we just increased everyone’s taxes – or so the claim will be.

Plan B is to keep SS taxes at the same level, or with only a bit of an increase, and designate part of everyone’s SS contribution as PSA money. That means there is less money in the till to pay for things that SS taxes are used for now --benefits plus spillover to the General Treasury. How you replace the latter is the problem. Some other taxes would have to increase to make up the shortfall.

Bottom line: PSA’s are a great idea, and I wish we had them. But however you slice it, they will require a tax increase, at least for a significant period of time. Some of us would gladly pay the increase in order to improve our benefits. But folks living hand to mouth would just see the tax increase and think they’re getting screwed.

The above hissed in response by: Dick E at January 25, 2007 1:04 PM

The following hissed in response by: Big D

Funny, the low return on Social Security is acceptable because , well, we don't want to risk the money of our seniors in more risky investments, and risk = reward. But that low return itself is imperiling Social Security.

Loved the speech. I wish more people would just listen to what Bush is saying, as opposed to those who are trying to filter and sift through every word.

Bottom line: PSA's are a great idea, and I wish we had them. But however you slice it, they will require a tax increase, at least for a significant period of time. Some of us would gladly pay the increase in order to improve our benefits. But folks living hand to mouth would just see the tax increase and think they're getting screwed.

You are far too pessimistic, Dick E. You keep payroll taxes (and SE tax) the same, but allocate an increasing portion of them each year, up to some predetermined max percentage, to the PSAs... which should not simply be savings accounts at a bank or S and L but a smorgasborg of investments, ranging from ultra-safe and insured to more risky but a higher return.

That means that an increasing portion of the collections are unavailable to Congress to borrow. Of necessity -- since raising taxes is politically virtually impossible -- Congress will have to reduce spending or increase the deficit... either of which is far preferable to high taxes or even to Social Security as it stands now.

But you have also fallen into the mortal sin of static analysis: as these SSA investment accounts grow, they make an increasingly enormous pile of capital available for investment by the brokerages and banks that hold them. This leads to a vast expansion of the natioanl economy -- as every country that has privatized Social Security has discovered.

Take a look at Chile's GDP growth following imposition privatization in 1981. Note that this table is of GDP growth, not the GDP itself; Chile has had robust GDP growth every year since privatization except 1999, during a global recession (they recovered strongly -- 4.5% growth -- the next year; and they were not hurt as badly as other Latin American countries).

There are problems with the Chilean system (remember, the economist blogger is very anti-free market; read some of his other posts); but none arises from the privatization itself, but rather from the specific implementation. The Times article Mark Thoma cites raises the following problems:

The pension-fund managers take too high a cut as fee -- easily fixed by fixing the percent they can take;

Many young people don't sign up for the system -- easily fixed by making the tax mandatory, and you just have to choose where it goes: a personal account owned by you, or a traditional account held by the government;

Many Chileans are still too poor to pay the minimum (10% of earnings) into the system; and many earn so little that they cannot save enough to pay for their retirement -- again, we don't have either of these two problems, because our economy is already staggeringly large; skimming a little off each account for a "retirement insurance policy" for the poor or the incredibly unlucky would resolve this problem.

And the expansion of the economy leads to a huge increase in tax revenues... without raising taxes by a single percent. This will eventually solve Chile's problems; and it would immediately benefit us, because we did not start where Chile started. Even after 25 years of extraordinary growth, their GDP is still only $200 billion.

The GDP of the United States is $13 trillion, 65 times the size of Chile's GDP. We simply would not have these problems... but we would more than equal the explosive growth in GDP were we to do what Chile did.

Privatizing Social Security actually more than pays for itself. It's an easy dynamic-analysis problem.

One problem I'm having is the whole ethanol thingy. My science background keeps screaming that this approach cannot possibly work.

The plants converts sunlight to plant matter. That plant matter then gets turned into ethanol. The ethanol gets put into a car, and gets turned into energy to make a car go.

Plants turn about 3% of sunlight into plant matter. Say (if we are lucky) 70% of that gets turned into ethanol. Say engines turn maybe 30% of the energy into movement.

At the end, probably 0.5% of the original solar energy goes into driving the car.

If you mowed down the crops and replaced them with solar cells, about 15% of the solar energy makes electricity. That goes down a wire to your house (assume a 20% line loss), so about 12% of the solar energy goes into the battery car. And 100% of this energy goes into making the car move.

So.....photovoltaic cells and battery cars are....about 25 times more efficient than ethanol? Am I missing something?

And I think I'm vastly overestimating the efficiency of ethanol, and underestimating the efficiency of solar cells. For example, good solar cells can be 30% efficient. You can put them on your roof to avoid line loss. They can work even in the winter (plants don't grow then).

We are probably at a ratio more like 50 or 100 to 1.

So what is all this folderol about ethanol?

The above hissed in response by: Big D at January 26, 2007 11:26 AM

The following hissed in response by: Dick E

Dafydd-

Static analysis! Oh, the humiliation!

But doesn’t dynamic analysis require looking at things over a period of time and considering all effects of a policy? The rest of the sentence (the part you didn’t highlight) says “at least for a significant period of time,” and I stand by that statement. No doubt the economic benefits you cite are real, but they do not occur overnight.

Obviously we’d have to have a gradual phase-in of PSA’s. Say we start with 5% of SS contributions eligible for PSA accounts. Well, every dollar in a PSA is a dollar the Feds had last year but can’t get their grubby mitts on this year. What’s a poor politician to do? At least as long as the Dems are in charge of Congress, I think you are far too sanguine about their reluctance to raise taxes.

I can just see Nancy Pelosi et al standing in front of a chart showing the gradual phase-in of PSA’s causing a ballooning deficit and than saying “Don’t worry – in a few years this PSA thing will grow our economy so much that these deficits will just melt away.” Sure. Everyone with income over $xxx (i.e. "the rich") hang onto your wallets.

(But you’re still a treasure, even with the static analysis zinger.)

The above hissed in response by: Dick E at January 26, 2007 12:11 PM

The following hissed in response by: Dick E

Big D-

Dafydd doesn’t seem to want to respond to your post. Now it’s the weekend, and the lizards are probably off shedding their skins or something, so I’ll take a crack at it.

The problem is, Mom & Dad want to take the brats to Disney World in the same vehicle they use for their daily commute. And they sure don’t want to spend an extra night or two sleeping in motels en route waiting for the family buggy to recharge. (“Are we there yet?” Sheesh!)

People want to keep on rolling once they hit the road. So until we come up with a really fast way to get back on the road – five minute recharges or swappable batteries? – I think we’ll still need some kind of combustible fuel, be it gasoline, ethanol, hydrogen or whatever.

The above hissed in response by: Dick E at January 27, 2007 12:12 PM

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